Unemployed? Consider Bankruptcy

by DeLadurantey Law Office, LLC on April 9, 2014

When you are unemployed, it may be the perfect time to file a bankruptcy case. It can be a difficult decision because when you are unemployed, creditors may consider you “judgment proof” and decide not to pursue collection against you. However, when you do not have a job, it may also be the right time for you to qualify under the means test for a Chapter 7 case.

The court uses the means test to determine if an individual is eligible for a Chapter 7 filing. The means test looks at your income for the previous six months to determine your ability to repay your creditors. If you have no income and haven’t had any for some time because you are unemployed, you may be able to file a Chapter 7 when you otherwise wouldn’t qualify.

The trustee may also review your future income even if you pass the means test. If the trustee believes you have the ability to pay your creditors, s/he could object to your discharge. When you are unemployed, the likelihood of the trustee taking this action is minute.

If you have lost your job and you are considering filing a bankruptcy case, schedule a consultation with us to determine how it may benefit you.